Mobile Computing Reports Third Quarter Results
Toronto Stock Exchange Symbol: MBL
TORONTO, Nov. 9 /CNW/ - Mobile Computing Corporation (MCC) (TSE:MBL), a
supplier of wireless information solutions for mobile workers, reported
financial results for the third quarter today. In the third quarter ended
September 30, 2000 the Company reached some major milestones in the
development of its new m-LINX suite of middleware products and mobile business
applications.
In September, MCC announced the following:
- m-mail, a new wireless e-mail application designed specifically for
enterprises with a mobile workforce. M-mail is the first deliverable
from the m-LINX suite.
- m-Xpander, a ruggedized serial port expander providing wireless
capability to in-vehicle CE handheld devices as well as providing
additional ports for numerous peripheral devices.
- the joint release of the wireless routing software (MAX) with our
partner, BSQUARE. MAX enables businesses to easily extend applications
such as e-mail, web browsing, work order management and other
enterprise applications to a mobile workforce.
Subsequent to the closing of the quarter, the Company unveiled the m-LINX
Mobile Worker Solution which provides the mobile worker with wirelessly
enabled enterprise applications for a wide range of industries.
"We are now developing a sales and marketing strategy for this dynamic
new product portfolio," said David Cunningham, President & CEO of Mobile
Computing Corporation. "We are particularly encouraged with the number of
potential alliance partners that are showing significant interest in the
opportunities that the m-LINX portfolio brings to the mobile workplace."
During the quarter MCC began a field trial of m-mail with a key customer.
In the fourth quarter the Company intends to supply a number of potential
alliance partners with MCC's complete m-LINX mobile solution package, in order
to begin product testing.
Other recent significant events included:
- At the CTIA show in Santa Clara, California MCC exhibited its new
offerings in the Sybase iANYWHERE booth and announced m-LINX Mobile
Worker Solution. MCC has since been invited by Microsoft to be one of
its selected partners and to demonstrate its products in Microsoft's
partner pavilion at this year's Comdex show in Las Vegas this
November.
- In the second quarter, MCC's MJ Systems division announced the release
of its latest software application, Perfect Delivery(TM), which
provides order fulfillment companies with the ability to efficiently
monitor product delivery.
In the third quarter MJ Systems entered into two agreements for pilot
installations of Perfect Delivery during the fourth quarter. One installation
is in MJ System's traditional market of periodical distribution and the other
is in a new vertical, the time-sensitive food distribution industry.
Consolidated revenues for the third quarter increased by 37% over the
same period last year. Overall, the financial results continue to reflect the
investment required to evolve from a Company that has been focused on the
waste and fuel delivery industries to one that offers a broad range of
wireless applications for mobile enterprises.
David Cunningham, President and CEO of the Company, stated: "We continue
to be on track with our business plan and are pleased about the level of
interest and excitement in our new offerings. We look forward to taking these
offerings to market and we are well positioned to move from a "construction"
phase in the year 2000 to a "production" phase in 2001."
Review of Financial Results
Mobile Computing Corporation reported consolidated revenues for the third
quarter ended September 30, 2000 of $3,799,000, an increase of 37% from
$2,773,000 for the corresponding period in the previous year. For the nine
months ended September 30, 2000, consolidated revenues were $9,854,000
compared to $11,934,000 last year. All revenue in the third quarter came from
sales of MCC's legacy products. The Company does not expect its new m-LINX
product suite to start generating revenue until fiscal 2001.
For the third quarter, the Company reported a net loss of $1,992,000, or
($0.05) per share, compared to a net loss of $2,233,000, or ($0.13) per share,
last year. In the third quarter of 1999, the Company recorded an inventory
write-down of $670,000. The loss in the third quarter of 2000 was consistent
with Management's business plan as investment was significantly increased in
sales and marketing. Gross margin decreased slightly from 38% to 34% due to
some lower margin hardware components in the sales mix. The average number of
shares outstanding were 38.2 million in the third quarter of 2000, compared to
17.0 million last year.
For the nine months ended September 30, 2000 the net loss was $6,685,000,
or ($0.20) per share, versus a net loss of $3,492,000, or ($0.21) per share
for the same period last year. The increase in net loss for the nine months
reflected increases in selling and marketing and research and development
expenses related to the m-LINX development program, as well as lower sales
experienced during the repositioning of the Company.
As of September 30, 2000 the Company held a net cash position of
$3,924,000 and working capital of $4,873,000. As previously announced, the
Company is proceeding with plans to obtain additional financing by the end of
this year.
Mobile Computing Corporation (MCC) is organized into two distinct
operating divisions. Segmented financial results were as follows:
Mobile Computing Systems (Mobile)
The Mobile division posted third quarter revenues of $1,378,000, in line
with $1,398,000 in the third quarter of 1999. The gross margin for the quarter
was 35% compared to 37% the previous year. The division's total operating
expenses were higher for the third quarter of 2000 at $1,592,000 versus
$1,222,000 for the same period last year due to increased levels of research
and development and marketing expenditures related to the Company's Next
Generation (m-LINX) products. Mobile recorded a net loss of $1,338,000 for the
third quarter of 2000 compared to a net loss of $1,654,000 for the same period
for 1999.
For the nine months ended September 30, 2000, the division posted sales
of $4,104,000 compared to sales of $4,987,000 for the same period in the
previous year, and a net loss of $4,238,000 compared to net loss of $3,150,000
last year.
MJ Systems (MJ)
The MJ Systems division reported third quarter revenues of $2,421,000, an
increase of 76% over revenues of $1,375,000 for the same period in 1999. Gross
margins decreased from 39% to 33% due to a higher hardware component of sales.
Despite the improvement in revenues, MJ reported a net loss of $655,000 for
the third quarter of 2000, compared to a net loss of $579,000 last year when
there was a tax recovery of $261,000. Operating expenses have not varied
significantly since 1999.
For the nine months ended September 30, 2000, the division's revenues
were $5,750,000 compared to $6,947,000 for the same period last year, and a
net loss of $2,447,000 compared to a net loss of $342,000 for the same period
in 1999.
About Mobile Computing Corporation
Mobile Computing Corporation (www.mobilecom.com) is a supplier of
wireless information solutions for mobile workers. These systems enable
companies to communicate with, monitor and manage the activities of their
vehicles and field personnel. MCC solutions enable improved management of the
movement and delivery of goods and services, improving productivity and
profitability. MCC specializes in delivering fully integrated solutions that
link mobile workers with corporate information systems utilizing wireless data
communications services. Mobile Computing Corporation trades on the Toronto
Stock Exchange under the symbol "MBL" and has approximately 40.8 million
shares outstanding.
This news release contains forward-looking statements that involve risks
and uncertainties, which may cause actual results to differ materially from
the statements made. When used in this document, the words "may", "would",
"could", "will", "intend", "plan", "anticipate", "believe", "estimate",
"expect" and similar expressions are intended to identify forward-looking
statements. Such statements reflect Mobile Computing Corporation's current
views with respect to future events and are subject to such risks and
uncertainties. Many factors could cause our actual results to differ
materially from the statements made including those factors detailed from time
to time in filings made by Mobile Computing Corporation with Canadian
securities regulatory authorities. Should one or more of these risks or
uncertainties materialize, or should assumptions underlying the forward
looking statements prove incorrect, actual results may vary materially from
those described herein as intended, planned, anticipated or expected. Mobile
Computing Corporation does not intend and does not assume any obligation to
update these forward-looking statements.
<<
CONSOLIDATED STATEMENT OF OPERATIONS
(unaudited - For the three months For the nine months
thousands of dollars) ended September 30 ended September 30
2000 1999 2000 1999
-------------------- --------------------
SALES $ 3,799 $ 2,773 $ 9,854 $ 11,934
Cost of goods sold 2,515 1,712 6,219 6,383
-------------------- --------------------
Gross margin 1,284 1,061 3,635 5,551
EXPENSES
Inventory write-down - 670 - 670
Research and development 777 700 2,395 1,651
Selling and marketing 937 582 3,014 1,739
Administration 1,063 1,067 3,450 3,336
-------------------- --------------------
2,777 3,019 8,859 7,396
-------------------- --------------------
LOSS BEFORE THE UNDERNOTED (1,493) (1,958) (5,224) (1,845)
Depreciation and amortization 384 353 1,112 1,043
Interest expense 115 183 349 551
Income tax expense (recovery) - (261) - 53
-------------------- --------------------
LOSS FOR THE PERIOD $ (1,992) $ (2,233) $ (6,685) $ (3,492)
-------------------- --------------------
-------------------- --------------------
LOSS PER SHARE $ (0.05) $ (0.13) $ (0.20) $ (0.21)
-------------------- --------------------
-------------------- --------------------
CONSOLIDATED BALANCE SHEET
(unaudited - thousands of dollars) As at September 30
2000 1999
-----------------------
ASSETS
Current assets:
Cash and cash equivalents $ 3,924 $ 2,249
Accounts receivable 2,013 1,876
Inventory 1,709 1,539
Prepaid expenses 185 98
-----------------------
7,831 5,762
Capital assets (net) 1,957 1,931
Intangible assets 1,703 2,611
Other assets 223 163
-----------------------
$ 11,714 $ 10,467
-----------------------
-----------------------
LIABILITIES
Current liabilities:
Accounts payable and accrued
liabilities $ 2,418 $ 1,683
Deferred revenue 263 591
Current portion of capital lease
obligation 277 273
-----------------------
2,958 2,547
Long term liabilities:
Capital lease obligation 196 397
Debenture 2,967 5,897
-----------------------
6,121 8,841
SHAREHOLDERS' EQUITY
Capital stock 30,468 17,926
Contributed surplus 65 65
Share options 83 166
Cumulative translation adjustment 358 109
Deficit (25,381) (16,640)
-----------------------
5,593 1,626
-----------------------
$ 11,714 $ 10,467
-----------------------
-----------------------
CONSOLIDATED STATEMENT OF CASH FLOWS
(unaudited -
thousands of dollars) For the three For the nine
months ended months ended
September 30 September 30
2000 1999 2000 1999
--------------------- --------------------
CASH PROVIDED BY (USED IN):
Operations:
Loss for the period $(1,992) $(2,233) $(6,685) $(3,492)
Items not involving
cash:
Depreciation 141 114 391 326
Amortization of
intangible assets 243 239 721 717
Amortization of other
assets 49 7 63 58
(Gain)/loss on disposal
of fixed assets - - - 2
Foreign exchange - 2 (1) (8)
Change in non-cash working
capital
Accounts receivable (103) 860 515 905
Inventory 95 781 (330) 1,076
Prepaid expenses 114 7 (99) (33)
Other assets (3) (21) (20) (23)
Accounts payable and
accrued liabilities (76) (980) (341) (884)
Deferred revenue (714) 204 (93) (488)
--------------------- --------------------
(2,246) (1,020) (5,879) (1,844)
Financing:
Repayment of capital
lease obligation (54) (37) (157) (76)
Short term financing - - - 588
Repayment of short term
financing - (588) - (588)
Issue of shares on
debenture conversion 3,000 - 3,000 -
Reduction of debenture
on debenture conversion (3,000) - (3,000) -
Issue of common shares on
exercise of employee
share options 73 - 160 -
Issue of common shares - 2,997 2,997
Issue of special warrants - - 9,012 -
Exercise of agent's
special warrants 125 - 287 -
--------------------- --------------------
144 2,372 9,302 2,921
Investments:
Capital asset additions (123) (136) (489) (217)
--------------------- --------------------
Increase (decrease) in
cash and cash equivalents (2,225) 1,216 2,934 860
Cash and cash equivalents,
beginning of period 6,149 1,033 990 1,389
--------------------- --------------------
Cash and cash equivalents,
end of period $ 3,924 $ 2,249 $ 3,924 $ 2,249
--------------------- --------------------
--------------------- --------------------
>>
%SEDAR: 00003758E
-30-
For further information: Media Inquiries: Kyle Warnick, Rolling Thunder
Marketing, (425) 889-0528 ext. 109, Kylew@rolling-thunder.com; Investor
Inquiries: Cory Pala, E-vestor Communications Inc., (416) 657-2400,
(416) 657-2300 fax, cpala@e-vestorcom.com; Customer Inquiries: David
Cunningham, President & CEO, Mobile Computing Corp., (905) 676-8900,
(905) 676-9191 fax, dcunningham@mobilecom.com.
To request a free copy of this organization's annual report, please go to
www.newswire.ca and click on reports@cnw. |
